News

Concerted campaign to keep police lease

Property tycoon Roux Shabangu has joined other voices in a public effort to validate the deal.

The campaign to save Roux Shabangu’s controversial R614-million Pretoria police headquarters lease moved into high gear this week.

Aspects of the government-backed effort to validate the lease, however, call into question procurement practices at the department of public works.

In February public protector Thuli Madonsela found the lease to be invalid, as the department of public works and the South African Police Service had bypassed the legal requirements for state procurement.

Madonsela ordered an urgent review to determine whether the contract could be terminated.

Public works dragged its feet until September before filing papers in the North Gauteng High Court seeking an order declaring the lease invalid.

Now, following the dismissal of former public works minister Gwen Mahlangu-Nkabinde, the department appears to be backtracking.

On November 11, the former acting director general of public works, Sam Vukela, signed an extraordinary affidavit in which he argued that the Pretoria lease was valid because it was impractical to seek competitive bids. The affidavit may fatally undermine the department’s high court application.

Vukela also revealed that of 2 950 leases concluded by the department in the past four years a competitive tender or quotation procedure was used in only 447 cases. This suggests that the department has comprehensively flouted supply-chain rules.

Vukela’s lawyer confirmed that Vukela’s draft affidavit had been provided to the new minister, Thulas Nxesi, to give him “an opportunity to comment, amend or object” and that no response had been received. This suggests Vukela’s actions have tacit ministerial support.

On November 22 Shabangu wrote to Madonsela claiming that he had identified 194 lease agreements in Pretoria between the department and other companies that were concluded without tender processes. According to Shabangu, 73% of the department’s lease agreements in Pretoria were made via direct negotiation and not via tenders.

Shabangu also embarked on a media campaign. The contents of his letter were made public, showing that he told Madonsela: “It is evident that the procurement process followed for the Middestad lease was in accordance with common practice within the [department].” He upped the ante by asking Madonsela to investigate all public works leases concluded using a negotiated process, instead of singling out his contract. He repeated his call on radio.

Shabangu also tried to distance himself from the controversial Independent Complaints Directorate (ICD) lease that put the ICD hugely over budget. To the evident surprise of public works and the ICD, he has denied being part of the company that concluded the lease.

In spite of saying publicly that he was “eagerly awaiting my day in court to prove that the Middestad lease was and is valid”, Shabangu has yet to file a reply to the department’s September application, suggesting he is reluctant to put his version on record.

The Shabangu contracts have already cost two ministers their jobs and led to the suspension of two directors general and police commissioner Bheki Cele.

Zuma removed Geoff Doidge as public works minister after Doidge launched an investigation into the Middestad deal and withheld approval for the signing of the lease.

No reasons have been given for Doidge’s demotion (he is now ambassador in Sri Lanka) but it is understood that he blames it on his opposition to Shabangu.

Mahlangu-Nkabinde confirmed the Middestad deal shortly after her appointment, in spite of Madonsela’s warnings and against senior counsel’s advice.

She also suspended the director general appointed by Doidge, Siviwe Dongwana, who claimed he was pressurised into signing off on the Middestad lease.

Zuma finally took action in October, suspending Cele and sacking Mahlangu-Nkabinde. It remains to be seen if his decision last week to relieve Willie Hofmeyr of his leadership of the Special Investigating Unit will have an affect on the probe of public works—and Shabangu’s fortunes.

The M&G Centre for Investigative Journalism, a non-profit initiative to develop investigative journalism in the public interest, produced this story. All views are ours. See www.amabhungane.co.za for all our stories, activities and sources of funding.